Here's my summary of the key overnight news in 90 seconds at 9 am, including news of a gigantic offer to settle legal woes.
In the US, durable goods orders for August came in above expectations and above the previous month, although the capital goods component wasn't so strong. At the same time US new home sales rose strongly to the level that was expected in August.
On Wall Street, the talk is of bank JPMorgan trying to clear up all its outstanding legal issues with regulators. Depending on reports, they may be offering anywhere from US$3 to US$7 billion to resolve matters (buy their way out). In this range, these fines would dwarf any previous settlement and indicate the depth of the bank's legal tangles.
Overnight, the American debt ceiling cliff got put back a couple of weeks with the US Treasury putting a date on when the cash will run out: October 17. But there is also talk that as a second term President, Obama may test the use of an obscure clause in their Constitution (the 14th Amendment), raise the ceiling himself, and put it on the Courts to rule. Such a move would anger many legislators and it is uncertain how the American public would react.
Speaking of debt, in Europe, France has revealed that its public debt will hit more than 95% of GDP in 2014, according to their latest budget plan.
In Australia, reports are emerging that their chilled beef exports to China are being blocked. Australia is by far the largest supplier to China, and some there suspect the 'safety issues' are a non-tariff attempt to aid local Chinese producers. There may be spin-off impacts for New Zealand. Something to watch, and comes on the back of a block on NZ apples into China.
Sensitivity to China will be what is behind Fonterra's remarks yesterday that the price of milk power is too high and needs to be normalised.
And speaking of sensitivity, Finance minister Bill English has kept up his attack on ASB and its withdrawal of mortgage pre-approvals. Expect the government to launch (or re-launch) an initiative to help first home buyers, probably in early October.
Markets are drifting ahead of the US debt crisis and government shutdown date. Equities are down; the Dow is down marginally in late trade. Oil is down again, now close to US$102/barrel, gold is marginally higher, and UST 10yr yields are down again, now at 2.64%.
The NZ dollar starts today lower at 82.5 USc, 88.1 AUc, and the TWI is at 76.8.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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